Asian Markets Move Higher in Afternoon Rally

CNBC.com

Tuesday, 10 Jun 2008 | 8:23 PM ETCNBC.com

SHARES

Asian markets staged a late rebound as persistent worries about inflation kept investors cautious for most of the morning session. However stocks rallied in the afternoon with Japan climbing over 1 percent.

Energy firms fell after oil prices slid by $3 a barrel on Tuesday on a strong dollar. Japan's Inpex Holdings shed 3 percent and South Korea's SK Energy slipped almost 1 percent. But weaker oil gave a boost cost-sensitive airline stocks such as Qantas, Korean Air Lines and Cathay Pacific.

Tokyo's Nikkei 225 Average closed up 1.2 percent, buoyed by exporters on a softer yen , while Daiichi Sankyo shot up after a newspaper reported the drugmaker plans to launch a bid for India's biggest generic drug maker, Ranbaxy.

Seoul shares closed 0.4 percent higher, with gains by technology issues such as Samsung Electronics on brightening earnings prospects outweighing losses by shipbuilders. Banks were in the spotlight after HSBC Holdings' Asia chief executive said it may consider pulling out of a planned $6.3 billion acquisition of Korea Exchange Bank. KEB fell 3.33 percent, while Kookmin Bank and Hana Financial Group both advanced.

Australian shares erased early losses finish about half a percent higher, as investors picked up Macquarie Group and other financials sold off in the previous session.

Singapore's Straits Times Index rose 0.8 percent after a lacklustre start. Printer SNP Corp shot up as much as 10 percent after it received a takeover offer from Japan's Toppan Printing, valuing the firm at S$208 million ($151.4 million).

China's Shanghai Composite Index was down 1.6 percent but came well off its early low after reaching chart support, and as brokerage shares gained on a rumor that authorities might soon introduce margin trade. The government intervened to support the market in April by cutting the stock trading tax, and many investors see a good chance of another rescueattempt -- perhaps the long-delayed introduction of margin trade and securities lending, which would benefit brokerages and could draw some buyers back to the market. Brokerage shares surged with Haitong Securities up over 7 percent.